How to save Income Tax in India: Forget savings and investments, you can do this by spending also
Have you ever wondered about any option that will allow you to save taxes on your expenses? Yes, there are certain rules under which you can claim tax exemptions based on your expenses.
How to save tax: Who doesn't want to save on taxes? Many people start their preparation with the start of the financial year itself. Also, there are people who take the tax saving steps at the eleventh hour. You must have read and heard about a lot of investment options to save on taxes. However, have you ever wondered about any option that will allow you to save taxes on your expenses? Yes, there are certain rules under which you can claim tax exemptions based on your expenses. Read on to find out.
Have you ever borne the expenses on the healthcare of family members dependent on you? If any of the dependent members are suffering from a grave illness, then you can claim tax exemption under section 80DDB for the expenses occurred on the treatment. The dependent members may be wife, husband, child, mother, father and even brothers and sisters.
According to taxguru.in, for the assessment year 2019-20, you can claim the exemption for the actual treatment expenses or Rs 40,000, whichever is less. The limit is Rs 1,00,000 for senior citizens. The diseases which are covered under the rule include Dementia, Dystonia Musculorum Deformans, Motor Neuron Disease, Ataxia, Chorea, Hemiballismus, Aphasia, Parkinsons, Malignant Cancers, AIDS, Chronic Renal failure, Hemophilia and Thalassaemia.
Under section 80C, you can claim an exemption for the school fees paid for your child. "The taxpayer can claim deduction under section 80C in respect of amount paid by him during the year towards tuition fees (excluding development fees, donation or similar payments) paid at the time of admission or thereafter, to any university, school, college or other educational institution situated in India, for full time education of any two children of the taxpayer," tax department has stated. The maximum limit is 1.5 lakh.
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Mediclaim premium benefit
If you have purchased mediclaim for yourself or your family, you can claim tax benefits for premium up to Rs 25,000. However, if you have bought it for your aged parents (senior citizens), you can claim tax benefits for premium up to Rs 50,000. If the taxpayer and his/her parents, both are senior citizens, then the claim amount gets hiked up to 1,00,000 under section 80D.